Using the CEV option pricing model, set 1and generate option prices for strikes from 60 to 140, in increments of 5, for times to maturity of 0 25, 0 5, 1 0, and 2 0 Plot the resulting implied volatilities (This should reproduce Figure 24 7 ) ...

You will have to decide on what program you use to solve this question It is easy to use Matlab beca ...

Using the CEV option pricing model, set = 1and generate option prices for strikes from 60

Question:

Using the CEV option pricing model, set β = 1and generate option prices for strikes from 60 to 140, in increments of 5, for times to of 0.25, 0.5, 1.0, and 2.0. Plot the resulting implied volatilities. (This should reproduce Figure 24.7.) Maturity
Maturity is the date on which the life of a transaction or financial instrument ends, after which it must either be renewed, or it will cease to exist. The term is commonly used for deposits, foreign exchange spot, and forward transactions, interest...